Sales $7000 3000 Less: Cost of goods sold Gross Profit Less: Operating expenses Selling expenses General and administrative expenses Lease expenses Depreciation expenses Total operating expenses Operating profits Less: Interest expenses Net profit before taxes Less: Taxes (30%) Net profit after taxes Less: Preferred stock dividends Earnings available for common stockholders Less: Common stock dividends Retained earnings 2220 200 2020 500 2013 2012 2013 Assets Current Assets Cash Account Receivable Inventory Total current assets 980 800 500 2280 2200 Liabilities and Stockholders' Equity Current liabilities Acct. payable Notes payable Accruals Long-term debt preferred stock Common stock (600,000 shares) Retained earnings Total Stockholders' equity Total liabilities and stockholders' equity Total gross fixed assets 8000 Less: Accu. depreciation 4164.8 Net fixed assets 3835.2 Total assets 6115.2 7000 4084.8 2915.2 5115.2 1200 815.2 2415.2 6115.2 1915.2 5115.2 CF from Operating Activities Net profits after taxes Depreciation for the year decrease in account receivable decrease in inventories increase in accounts payable increase in accruals CF provided by operating activities CF from Investment Activities Decrease in gross fixed assets Changes in equity investment in other firms CF provided from investment activities CF from financing activities Increase in notes payable Increase in long-term debt Changes in stockholders' equity less Total dividend paid CF provided by financing activities Total cash added to reserve